### Lower your electricity bill by 20% with EnergyBot

Load factor is a measure of how consistently you use energy. Energy providers use load factor as a metric to determine the rate you pay for electricity usage (your cost per kWh). Utilities use load factor to determine the tariff classification your business is placed in that determines how much you pay for demand charges. A high load factor is more desirable than a low load factor.  ## How to calculate load factor

The load factor calculation divides your average demand by your peak demand. To calculate your load factor take the total electricity (KWh) used in the billing period and divide it by the peak demand (KW), then divide by the number of days in the billing cycle, then divide by 24 hours in a day. The result is a ratio between zero and one. Or you can use the load factor calculator at the top of this page.

## What is a good load factor?

Load factor varies by industry and many variables. In general a load factor greater than 80% is great, 50%-65% is average, and below 50% is low. Since a higher load factor usually means lower prices, the higher the load factor the better.  